BlueArc Branches Out

BlueArc Corp., in danger of burning through whats left of its $157 million in funding, today added software enhancements to its Titan NAS system. The goal: to make its wares more appealing to mainstream customers.

BlueArc’s first major release for the Titan since it was launched in 2004 includes virtual servers, policy-based data migration, iSCSI support, remote volume mirroring, and WORM file system support (see BlueArc Titan to Battle Giants). Each feature is available as a separate license per Titan, running approximately $10,000 apiece.

BlueArc claims more than 150 customers, many in verticals such as life sciences, entertainment, CAD/CAM engineering, and Internet services (see Turner Studios Casts BlueArc and BlueArc Consolidates Life Sciences Firm). While the Titan was built as a high-performance system to handle the large file demands of those verticals, it lacked features such as disaster recovery, failover, and data protection required by mainstream NAS customers.

IDC storage systems program manager Brad Nisbet says the new software is necessary for BlueArc to compete with Network Appliance Inc. (Nasdaq: NTAP) and EMC Corp. (NYSE: EMC) – the two dominant enterprise NAS players (see IDC: Networked Storage Up).

“BlueArc has made its mark in particular verticals based on their high-performance hardware,” Nisbet says. “This is definitely a move to tap into more mainstream opportunities. This is a good step in the right direction, as the company will need to expand beyond vertical niches.”BlueArc's corporate communications manager, Louis Gray, says the software release is also a sign of the company’s stability at a time when its finances receive more attention than its products. Sources inside and close to the company say it is burning from $10 million to $12 million per quarter and probably won’t have enough to sustain it through profitability without more help, despite hefty funding (see BlueArc Wallows in $47M Haul).

Sources say BlueArc’s investors have committed another $12 million to keep it afloat and try to get a return on their investment. Gray won’t confirm that, but says BlueArc’s VCs are ready to put up more if necessary.

“Our VCs from day one were committed to keeping us fully funded,” he says. “But if they have to give us money for expansion, that’s in the can.”

Profitability has been a moving target for BlueArc. New CEO Mike Gustafson has been reluctant to give a specific target for profitability (see BlueArc's Gustafson Moves Up). That's understandable: A year ago, founder and then-CTO Geoff Barrall predicted BlueArc would turn a profit in the first quarter of this year (see BlueArc's Barrall Says Bye Bye). By January, that was pushed back to the fourth quarter.

Here's a rundown of the latest enhancements: